Vodafone Group Plc Annual Report for the year ended 31 March 2012

Vodafone Group Plc
Annual Report 2012
111
Deferred tax assets and liabilities, before offset of balances within countries, are as follows:
Amount
Net
(charged)/
recognised
credited Gross Gross Less deferred tax
in income deferred deferred tax amounts (liability)/
statement tax asset liability unrecognised asset
£m £m £m £m £m
Accelerated tax depreciation (792) 198 (4,595) – (4,397)
Intangible assets 178 620 (2,061) (275) (1,716)
Tax losses 254 24,742 – (22,515) 2,227
Deferred tax on overseas earnings (13) – (1,796) – (1,796)
Other short-term temporary differences 32 3,254 (877) (1,322) 1,055
31 March 2012 (341) 28,814 (9,329) (24,112) (4,627)
Analysed in the statement of financial position, after offset of balances within countries, as:
£m
Deferred tax asset 1,970
Deferred tax liability (6,597)
31 March 2012 (4,627)
Amount
Net
(charged)/
recognised
credited Gross Gross Less deferred tax
in income deferred deferred tax amounts (liability)/
statement tax asset liability unrecognised asset
£m £m £m £m £m
Accelerated tax depreciation (1,374) 253 (3,682) – (3,429)
Intangible assets (140) 815 (2,449) (335) (1,969)
Tax losses 1,198 27,882 – (25,784) 2,098
Deferred tax on overseas earnings 764 – (1,775) – (1,775)
Other short-term temporary differences (265) 4,075 (395) (3,073) 607
31 March 2011 183 33,025 (8,301) (29,192) (4,468)
Analysed in the statement of financial position, after offset of balances within countries, as:
£m
Deferred tax asset 2,018
Deferred tax liability (6,486)
31 March 2011 (4,468)
Factors affecting the tax charge in future years
Factors that may affect the Group’s future tax charge include the impact of corporate restructurings, the resolution of open issues, future planning
opportunities, corporate acquisitions and disposals, the use of brought forward tax losses and changes in tax legislation and tax rates.
The Group is routinely subject to audit by tax authorities in the territories in which it operates, and specifically, in India these are usually resolved
through the Indian legal system. The Group considers each issue on its merits and, where appropriate, holds provisions in respect of the potential tax
liability that may arise. However, the amount ultimately paid may differ materially from the amount accrued and could therefore affect the Group’s
overall profitability and cash flows in future periods.
At 31 March 2012 the gross amount and expiry dates of losses available for carry forward are as follows:
Expiring
Expiring
within
within
5 years 6-10 years Unlimited Total
£m £m £m £m
Losses for which a deferred tax asset is recognised 68 31 8,317 8,416
Losses for which no deferred tax is recognised 1,838 670 82,912 85,420
1,906 701 91,229 93,836
The losses arising on the write down of investments in Germany are available to use against both German federal and trade tax liabilities. Losses
of £3,804 million (2011: £3,892 million) are included in the above table on which a deferred tax asset has been recognised. The Group has not
recognised a deferred tax asset on £11,547 million (2011: £13,389 million) of the losses as it is uncertain that these losses will be utilised.
Included above are losses amounting to £1,907 million (2011: £1,907 million) in respect of UK subsidiaries which are only available for offset against
future capital gains and since it is uncertain whether these losses will be utilised, no deferred tax asset has been recognised.
The losses above also include £72,696 million (2011: £82,725 million) that have arisen in overseas holding companies as a result of revaluations
of those companies’ investments for local GAAP purposes. No deferred tax asset is recognised in respect of £68,653 million of these losses as it is
uncertain whether these losses will be utilised. A deferred tax asset has been recognised for the remainder of these losses (see page 112).
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